Bergeson & Campbell, P.C. (B&C®) is a Washington, D.C., law firm providing biobased and renewable chemical product stakeholders unparalleled experience, judgment, and excellence in bringing innovative products to market.

By  Lynn L. Bergeson 

EPA has posted a Compliance Advisory entitled “Applicability of the Toxic Substances Control Act to Chemicals made from Petroleum and Renewable Sources Used as Fuels and Fuel Additives and Distillates.” The Compliance Advisory states that EPA is reaffirming that chemical substances used as fuels, fuel additives, and distillates made from either petroleum or renewable sources are subject to TSCA. Anyone who plans to manufacture (including import) a chemical made from petroleum or renewable sources must comply with the statutory and regulatory new chemical requirements under TSCA Section 5. According to the Compliance Advisory, EPA has received stakeholder inquiries “as to whether fuel and fuel additives made from renewable sources (such as renewable naphtha) are subject to the TSCA new chemicals requirements under section 5.” EPA states that it is issuing the Compliance Advisory “to affirm that fuel and fuel additives either made from petroleum or renewable sources are subject to TSCA and have been subject to its requirements since 1976.”

According to the Compliance Advisory, there are about 142 “naphthas” and 178 “distillates” (that compositionally can qualify as naphthas) currently on the TSCA Inventory, and they are considered Unknown, Variable composition, Complex, or Biological (UVCB) substances. Any substance that is not on the TSCA Inventory is a new chemical under TSCA Section 5(a)(1)(A). Prior to manufacture (including import) of a new chemical for commercial use, a premanufacture notice (PMN) must be filed with EPA under TSCA Section 5. The Compliance Advisory includes several questions and answers (Q&A), including:

Can you manufacture or import a chemical substance made from a renewable source if it is not listed on the TSCA Inventory?

No. Anyone who intends to manufacture (including import) a new chemical substance that is subject to TSCA for a non-exempt commercial purpose is required to submit a PMN at least 90 days prior to the manufacture of the chemical. Manufacturers (importers) are in violation of TSCA if they fail to comply or are late in complying with TSCA notice requirements. If you are required to submit a PMN, failure to do so is a violation of TSCA Section 15 and you may be subject to penalties. PMN submissions must include all available data, pursuant to 40 CFR 720.45 and 720.50. TSCA requires EPA to review the notice and make a determination; and, if appropriate, regulate the proposed activity.

EPA’s “compliance advisory” is disappointing. It signals this EPA is disinclined to promote renewable petroleum cuts and essentially (and emphatically) reaffirms what we believe to be EPA’s inflexible and unimaginative stance on “source” being determinative in petroleum cut UVCBs. This position, as we have noted in a variety of regulatory contexts, is a substantial disincentive to commercializing renewable petroleum cuts. EPA’s view is especially problematic when a refinery might wish to use a combination of petroleum and renewable feedstocks to make a single naphtha (or other distillate) cut.

For example, to avail itself of the equivalence determination, a company would have to submit a PMN for the renewable equivalent of a petroleum cut, sign the almost certain resultant consent order (EPA will undoubtedly identify aquatic toxicity concerns and may also identify health concerns), commence manufacture, file a Notice of Commencement of Manufacture or Import (NOC), and then request an equivalency determination. If EPA denies the equivalency determination, any downstream processor or user will have to either segregate the renewable products from the petroleum products so that the downstream entity can maintain records of compliance with the consent order or treat both the renewable and petroleum products as being subject to the order. Neither option is commercially feasible or sustainable.

This sequence of events illustrates why commercial entities are disinclined to avail themselves of renewable sources in the distillate space. EPA’s compliance advisory is an unexpected and, to many, unwanted parting gift from the Trump Administration. The Biden Administration may wish to revisit the wisdom and prudence of this inflexible, antiquated, and inequitable view.


 

On February 19, 2016, Kathleen M. Roberts, Executive Director of BRAG, presented "Achieving Critical Policy Changes through Consortia" at the 2016 Advanced Bioeconomy Leadership Conference (ABLC2016). Ms. Roberts presented as part of The Bioeconomy R&D Consortia Summit and discussed the work being done by BRAG to level the regulatory playing field for biobased chemicals. BRAG has successfully petitioned the U.S. Environmental Protection Agency (EPA) to make Chemical Data Reporting (CDR) partial reporting exemptions that are already granted to petroleum products available to biodiesel products as well. BRAG is also currently working to resolve the limitations of the Soap and Detergent Association (SDA) nomenclature system for Toxic Substances Control Act (TSCA) Inventory purposes. SDA nomenclature allows for chemical identification by alkyl range rather than source, but is limited to 35 predetermined sources. BRAG petitioned EPA on October 7, 2015, to implement, via rulemaking, a process that would broaden the sources on the SDA nomenclature list. BRAG sought to include such sources as algae and non-traditional plant materials. The petition was denied because, according to EPA, the Agency lacks the authority to initiate rulemaking under TSCA Section 8(b). EPA also claimed that BRAG did not justify the need for regulatory relief, given that the petition lacked a specific example of products experiencing this issue. While BRAG respectfully disagrees with EPA's reasoning, the denial allowed EPA to express its concurrence with BRAG's view that the SDA nomenclature is limited to the predetermined sources, and expressed a willingness to discuss approaches to address the limitation, either through changes to nomenclature guidance, or through rulemaking to establish an exemption under TSCA Section 5(h)(4). If companies wish to ensure that the SDA nomenclature list expands, they should consider joining BRAG and assist with future engagement with EPA.

For a copy of this presentation, please contact .(JavaScript must be enabled to view this email address).


 

Part 3 of Biofuels Digest's "Thought Leadership" series highlighting some of the ways the Toxic Substances Control Act (TSCA) applies to biobased products was published May 18, 2015. Summaries of the first two "TSCA and the Bioeconomy" articles, written by Biobased and Renewable Products Advocacy Group (BRAG®) Senior Policy Advisor and former head of the U.S. Environmental Protection Agency's (EPA) Green Chemistry program, Richard E. Engler, Ph.D., were summarized in the May 7, 2015, BRAG report.

"The Toxic Substances Control Act and the Bioeconomy: Part 3, Call to Action," presents options for reforming TSCA and the related implementing regulations to put novel, biobased chemistry on an even footing with incumbent products and processes that were grandfathered under the original TSCA Inventory. Among the suggestions and options offered is the expansion of the Soap and Detergent Association (SDA) nomenclature system to cover more sources related to biobased products:

Opening the 40-year-old list of organisms eligible to use SDA nomenclature would go a long way towards enabling novel triglyceride sources to enter commerce without triggering new chemical substance notifications throughout the supply chain. Right now, EPA has no mechanism for adding sources without conducting a full rulemaking. A mechanism that enables EPA to add sources to the SDA list as part of the premanufacture notice (PMN) review of a new source would maintain EPA's ability to ensure new sources do not present unreasonable risk to human health and the environment, as well as lower the barrier to market adoption of these new sources.

The article closes with a call for the regulated community, both producers and their customers to:

[E]ngage with EPA to seek broad solutions, as a group, rather than individual companies seeking individual solutions. These solutions may require rulemaking and a collective approach could bring the issue to a high enough priority to justify the effort and expense for EPA to undertake rulemaking.

Dr. Engler will be speaking about opportunities and challenges presented by TSCA for the biobased products community at the 19th Annual American Chemical Society (ACS) Green Chemistry & Engineering Conference, July 14 - 16, Bethesda, Maryland, and at BIO World Congress on Industrial Biotechnology, July 19 - 22, Montreal, Canada. .(JavaScript must be enabled to view this email address) if you plan on attending either of these events and would like to speak further about these issues while at the conferences.